In 2002, the FCC reallocated the 698-746 MHz spectrum band (Lower 700 MHz Band) that had been allocated to television Channels 52-59. The recovery of the Lower 700 MHz Band will be made possible by the conversion of television broadcasting from the existing analog transmission system to a digital transmission system.

It’s prime real estate. It’s licensed. That reduces interference significantly. In addition, the 700 Mhz band can use more power. All that adds up to the best wireless broadband spectrum available in the United States. Some observers believe 700 Mhz will deliver better-than cell range with less cost and more speed.

A killer combination.

The $28 billion figure might even be conservative, given that bidders most likely will pay more to have access to a signal that covers twice the area of cellular at 1.9 GHz, the Brattle Group, added. The 700 MHz band is better equipped than the 1.9 GHz band “for providing broadband wireless services,” it said.

The 700 MHz category currently occupies 108 MHz of the radio-frequency spectrum, but 48 MHz of that bandwidth is not available for public auction because it has been sold or is allocated for public safety communications.

“Our estimate represents only the auction revenue … that this 60 MHz of spectrum of unencumbered spectrum in the 700 MHz band would generate,” the Zarakas and Robyn letter continued. Their research was commissioned by Qualcomm, a member of the HDTV Coalition that wants the spectrum.

The letter also said the sale of the spectrum “would result in benefits to American consumers in the form of new broadband services and lower prices of existing services.”

Only six (“D”) channels are available in broad sections of the United States, nearly the size of time zones. That channel, at 716 MHz-722 MHz (UHF channel 55), is now home to Qualcomm’s MediaFlo, a mobile TV service wholesaled to cellular operators. It will cover the United States with mobile television. QUALCOMM bid $38 million for the five available Economic Area Grouping (EAG) D block 700 Mhz licenses and picked up the 6th (the Pacific Region) from Aloha Partners who won that license in the FCC s previous auction (Auction 44).

Qualcomm is investing $800 million to launch MediaFlo, their national cellular TV service in 2006 over its own 700 Mhz spectrum, broadcasting up to 20 channels for wireless carriers to sell their customers.

Qualcomm’s MediaFLO network is capable of carrying up to 100 channels, with as many as 15 of them streaming live video. As a shared resource for U.S. CDMA2000 and WCDMA (UMTS) operators, the network will carry content in the nationwide 700 MHz spectrum (UHF TV channel 55) owned by the CDMA pioneer. Qualcomm plans a one-way broadcast service for mobile users.

In the past, federal auctions of American airwaves, especially for cellular communication, has been a “win-win situation for both the government and consumers,” said Patrick Ross, a spokesman for The Progress and Freedom Foundation, whose group is a conservative think tank in Washington focusing on digital technology.

Under FCC guidelines, the sale of 700 MHz band, currently used by some television stations, could start next year.

The United States “devotes only about 190 MHz of spectrum to fixed and mobile wireless communications services, and that figure has not grown since the mid-1990s” the letter said, adding that European nations “allocate 255-300 MHz on average” for similar services, with the exception of Germany, the Netherlands and the United Kingdom. These countries allocate 302 MHz, 355 MHz and 340 MHz, respectively, according to the letter.

Under current law, broadcasters are required to turn over their analog spectrum by Dec. 31 of next year. A cleverly worded, broadcaster-inspired caveat to the law, however, renders that deadline almost pointless: if fewer than 85 percent of the homes in a market can receive digital signals, broadcasters may continue to camp out in their analog spectrum.

But the bill includes no subsidy for the $50 boxes, which would convert digital to analog for consumers who use analog TVs that rely on antenna rather than on cable or satellite TV.

Key Republicans say they’re willing to set aside $500 million for a subsidy for households that have no cable or satellite service and that earn less than $30,000. “I myself could support a limited subsidy for low-income households,” says Rep. Joe Barton, R-Texas, chairman of the House Commerce Committee.

Most Democrats say anyone who buys a box should get a subsidy. They would include even more affluent consumers, as well as lower-income, antenna-only homes where the box would be used for second sets and in pay-TV homes with extra sets that use antennas. “A digital TV tax will not go over very well with consumers,” says Rep. Ed Markey, D-Mass.

Last year, Nextel picked up MMDS (2.5 GHz) licenses for almost half the big cities in the U.S. for $214 million, mostly as part of WorldCom’s bankruptcy fire sale. McCaw’s IFTS/MMDS (2.5 Ghz) patchwork includes WatchTV, which controls 33 channels of ITFS and MMDS in Ohio; Speednet, whose licenses cover 500,000 households in north and central Michigan; and Gryphon Wireless, which uses ITFS channels in Nebraska. Steve Stoh saysAirspan and Vyyo are shipping 700 MHz gear. Airspan and picoChip plan a product, called SoftMAX, for 802.16e mobility.

With WiMax Chipsets, McCaw’s Clearwire (or Sprint-Nextel) could offer a double-whammy; 700Mhz could handle public service radios (on their own frequencies or Aloha’s), while the 2.5GHz band (using 802.16e) could deliver mobile service to multi-media phones, music players, video-enabled PDAs and laptops.

Market researcher Maravedis predicts that there will be more than 16 million Mobile WiMAX users within the next few years and that Mobile WiMAX chipset revenues could reach more than $700 million by 2010.